Dish Network L.L.C. v. ABC, Inc. et al

Filing 10

MEMORANDUM OF LAW in Support re: 3 Order to Show Cause,,,,,,,,. Document filed by Dish Network L.L.C.. (Bicks, Peter)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
DISH NETWORK L.L.C.,
Plaintiff,
12 Civ. 4155 (LTS) (KNF)

v.
AMERICAN BROADCASTING
COMPANIES, INC., CBS CORPORATION,
the FOX ENTERTAINMENT GROUP, INC.,
FOX TELEVISION HOLDINGS, INC., FOX
CABLE NETWORK SERVICES, L.L.C., and
NBCUNIVERSAL MEDIA, L.L.C.,
Defendants.

MEMORANDUM OF LAW IN SUPPORT OF
DISH NETWORK L.L.C.'S MOTION FOR AN ANTI-SUIT
INJUNCTION AND TEMPORARY RESTRAINING ORDER

TABLE OF CONTENTS
Page
PRELIMINARY STATEMENT

1

FACTUAL BACKGROUND

7
14

ARGUMENT
I.

II.

FOX, CBS AND NBC SHOULD BE ENJOINED FROM PURSUING
DUPLICATIVE ACTIONS IN CALIFORNIA, AND FOX SHOULD BE
TEMPORARILY RESTRAINED FROM PURSUING ITS ACTION PENDING
A RULING BY THIS COURT

14

THE BALANCE OF CONVENIENCE FACTORS FAVOR DISH'S FIRSTFILED ACTION

17

(1)

Trial Efficiency and the Interests of Justice

17

(2)

Convenience of the Parties

19

(3)

Familiarity With The Applicable Law

19

III. NO 'SPECIAL CIRCUMSTANCES' WARRANT PROCEEDING IN A
LATER-FILED FORUM
23

CONCLUSION

(i

)

TABLE OF AUTHORITIES
Page(s)
FEDERAL CASES

Al'trade, Inc. v. Uniweld Prods., Inc.,
946 F.2d 622 (9th Cir. 1991)

14

Assicurazioni Generali, SpA v. Terranova,
40 Fed. R. Serv. 2d 850, 1984 WL 1191 (S.D.N.Y. Oct. 25, 1984)

10

Bluefire Wireless, Inc. v. Cloud9 Mobile Commc'ns, Ltd.,
No. 09 Civ. 7268, 2009 WL 4907060 (S.D.N.Y. Dec. 21, 2009)

19

BuddyUSA, Inc. v. Recording Industry Ass 'n of Am.,
21 Fed. Appx. 52 (2d Cir. 2001)

16, 20, 21

Cfirstclass Corp. v. Silverjet PLC,
560 F. Supp. 2d 324 (S.D.N.Y. 2008)

18

Citigroup, Inc. v. City Holding Co.,
97 F. Supp 2d 549 (S.D.N.Y. 2000)

15

Daimler-Chrysler Corp. v. General Motors Corp.,
133 F. Supp. 2d 1041 (N.D. Oh. 2001)

15

Derman v. Gersten,
22 F. Supp. 877 (E.D.N.Y. 1938)

11

Direct Mail Prod. Services Ltd. v. MBNA Corp.,
No. 99 Civ. 10550, 2000 WL 1277597 (S.D.N.Y. Sept. 7, 2000)

19

Employers Ins. of Wausau v. Fox Entm't Group, Inc.,
522 F.3d 271 (2d Cir. 2008)

14, 16, 22

Everest Capital Ltd. v. Everest Funds Mgmt., L.L.C.,
178 F. Supp. 2d 459 (S.D.N.Y. 2002)

17, 20, 22

First City Nat'l Bank & Trust Co. v. Simmons,
878 F.2d 76 (2d Cir. 1989)

14

Formflex Founds., Inc. v. Cupid Founds., Inc.,
383 F.Supp. 497 (S.D.N.Y. 1974)

16

Horn & Hardart Co. v. Burger King Corp.,
476 F.Supp. 1058 (S.D.N.Y. 1979)

15, 16

TABLE OF AUTHORITIES
(continued)
Page(s)

Intuitive Surgical, Inc. v. Cal. Institute of Tech.,
No. 07 Civ. 0063, 2007 WL 1150787 (N.D. Cal. Apr. 18, 2007)

20

Kellen Co. v. Calphalon Corp.,
54 F. Supp. 2d 218 (S.D.N.Y. 1999)

20

Meeropol v. Nizer,
505 F.2d 232 (2d Cir. 1974)
Nanopierce Tech., Inc. v. Southridge Capital Mgmt.,
No. 02 Civ. 0767, 2003 WL 22882137 (S.D.N.Y. Dec. 4, 2003)
New York v. Exxon Corp.,
932 F.2d 1020 (2d Cir. 1991)

15, 16

18

14, 16

Pacesetter Sys., Inc. v. Medtronic, Inc.,
678 F.2d 93 (9th Cir. 1982)

14

Reliance Ins. Co. v. Six Star, Inc.,
155 F. Supp. 2d 49 (S.D.N.Y. 2001)

passim

Roby v. Corp. of Lloyd's,
996 F.2d 1353 (2d Cir. 1993)

18

Stewart Organization, Inc. v. Ricoh Corp.,
487 U.S. 22 (1988)

18

Stroock & Stroock & Lavan v. Valley Sys., Inc.,
No. 95 Civ. 6513, 1996 WL 11249 (S.D.N.Y. 1996)

15

Summit Entm't, LLC v. Bath & Body Works Brand Mgmt., Inc.,
No. 11 Civ. 3570, 2011 WL 2649973 (C.D. Cal. July 5, 2011)

14

Toy Biz, Inc. v. Centuri Corp.,
990 F.Supp. 328 (S.D.N.Y. 1998)
United States v. Doherty,
786 F.2d 491 (2d Cir. 1986)

15, 20, 23

20

FEDERAL STATUTES
28 U.S.C. § 1404(a)

17

TABLE OF AUTHORITIES
(continued)
Page(s)
RULES
1, 4, 16

Fed. R. Civ. P. 65
OTHER AUTHORITIES
10B CHARLES ALAN WRIGHT, ARTHUR R. MILLER, MARY KAY KANE & RICHARD L.
MARCUS, FEDERAL PRACTICE & PROCEDURE § 2761 (3d Ed. updated 2012)

(iv)

11

Fox is seeking extraordinary relief in a district court in California in an effort to preempt
litigation of this suit. Fox is seeking that relief despite the facts that the New York suit (this
case) was filed first, that the New York suit is the only one that includes all the relevant parties to
the dispute, and that the contracts in dispute with two of the four networks require that any
dispute be litigated in New York. Unfortunately, because Fox has been unwilling to delay even
temporarily its rush to preempt the jurisdiction of this Court, Plaintiff DISH Network L.L.C.
("DISH") is forced to seek an anti-suit injunction, pursuant to Rule 65 of the Federal Rules of
Civil Procedure, to prevent defendants Fox Entertainment Group, Inc., Fox Television Holdings,
Inc. and Fox Cable Network Services, L.L.C. (collectively "Fox"), CBS Corporation ("CBS")
and NBCUniversal Media L.L.C. ("NBC"), and any other persons or entities who are in active
concert or participation with those defendants, including but not limited to affiliated entities,
from proceeding with their later-filed copyright infringement and breach of contract actions in
California or any further litigation embracing the facts alleged in this action or those late filed
California actions. DISH further requests a temporary restraining order against Fox. This
dispute belongs in New York.

PRELIMINARY STATEMENT
On May 10, 2012, DISH added an "AutoHop" feature to its latest high definition ("HD")
digital video recorder ("DVR") known as the "Hopper." (See Declaration of Elyse D. Echtman
dated May 29, 2012 ("Echtman Dec.") Ex. 1. ("DISH Comp."), ¶ 23.) Technology has existed
since at least the 1970's that has allowed consumers to skip through commercials. AutoHop is
the latest feature that allows television viewers the freedom of choice to skip commercials. Id.
¶'J 6, 25. AutoHop permits customers to skip the entire commercial break when playing back

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certain recorded network primetime programs. Id. ¶ 23. Television viewers can also watch a
recorded show with the commercials intact. Id. T 6. It is their choice.
The top executives of the major television networks responded to AutoHop with a
barrage of negative media attacks. DISH Comp.

32-34. For example, Les Moonves, the

Chairman of CBS, called the AutoHop "illegal." In response to this unfair disparagement (and
similar attacks), which in turn created market uncertainty, and a subsequent simultaneous refusal
by certain of the networks to accept DISH's television advertisements for the Hopper DVR,
DISH filed this action against all four major networks seeking a declaratory judgment that
DISH's Hopper DVR, and its AutoHop commercial-skipping feature, do not infringe on the
networks' copyrights. DISH also seeks a declaration that it is in compliance with its retransmission contracts with the networks that authorize DISH to re-broadcast the networks'
programming

rights for which DISH pays the networks hundreds of millions of dollars per

year. Id. ¶J 3, 31, 37-44. DISH commenced this action in the Southern District of New York on
Thursday, May 24, 2012 at 4:06 p.m. EDT to protect and safeguard its ability to market and sell
its lawful product.
DISH had no idea that three of the networks

defendants Fox, NBC and CBS

were

on their way to court. Without any advance notice to DISH, Fox, NBC and CBS filed obviously
coordinated actions, ad seriatim, in the Central District of California, later that same day, taking
issue with the Hopper and AutoHop. While the networks made vague and generalized
statements in the media attacking AutoHop, none wrote the customary cease and desist letter
threatening litigation.
Fox and certain affiliates were the first of the networks to commence an action against
DISH in the Central District of California. The Fox entities assert copyright infringement and

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breach of contract claims against DISH. (Echtman Dec. Ex. 4.) Approximately one hour after
Fox's action was filed, NBC and certain affiliates also sued DISH for copyright infringement
action in the Central District of California. (Echtman Dec. Ex. 5.) Finally, certain CBS affiliates
likewise commenced a copyright infringement action against DISH in the Central District of
California approximately one hour after NBC. (Echtman Dec. Ex. 6.) Within the span of less
than three hours, three of the four major networks brought separate lawsuits over the same
technology.
CBS and NBC are represented by the same counsel and make virtually identical
allegations against DISH. Amazingly enough, even though the Fox, NBC and CBS cases all
relate to DISH's Hopper DVR and AutoHop, and the three actions have similar or identical
claims of copyright infringement and would involve a substantial duplication of labor by three
different judges, all three civil cover sheets check "no" as to whether there were related cases
filed in the same court. (Echtman Dec. Exs. 5, 6.) Each case is assigned to a different Central
District of California judge. Id.
This litigation among DISH and the networks has received extensive press coverage. The
Los Angeles Times says that "[t]he major broadcast networks' legal skirmish with satellite
television service Dish Network over its new ad-skipping device is shaping up to be a titanic
struggle with enormous implications." Meg James & Dawn C. Chmielewski, Networks' Fight
with Dish over Ad-Skipping has Huge Implications, L.A. TIMES, May 25, 2012,
http://www.latimes.com/entertainment/envelope/cotown/la-et-ct-broadcast-networks-fight-withdish-over-adskipping-has-enormous-implications-20120525,0,4852990.story;(Echtman Dec. Ex.
8).

(3)

This Court, as the court assigned the first-filed case, is tasked with determining where
these nearly identical claims should be heard. But the Fox defendants have indicated that they
will not recognize this Court's priority to decide that question. DISH has repeatedly requested
that Fox respect the authority of this Court, but Fox has brought an Order to Show Cause in the
Central District of California and has refused to hold it in abeyance until this Court resolves the
question. (Echtman Dec. Exs. 4, 15.)
Accordingly, DISH moves this Court, pursuant to Fed. R. Civ. P. 65, for an anti-suit
injunction against Fox, NBC and CBS to enjoin them from proceeding with their later-filed
duplicative lawsuits, and in favor of all issues being joined in DISH's first-filed comprehensive
action in this Court. DISH seeks a temporary restraining order against Fox to prevent it from
pursuing its Order to Show Cause in California.
This Court is the appropriate forum for several reasons. First, the legal rule is that the
first-filed case takes precedence and is presumptively the proper forum in the face of competing
actions with overlapping claims. Second, the Southern District of New York is the only forum
where all of these copyright infringement and breach of contract claims may be heard. DISH's
claims against ABC will proceed in this Court, as ABC has not filed a competing action, and the
Southern District of New York is the mandatory forum in DISH's contract with ABC. (Echtman
Dec. 17.) The Southern District of New York is also one of two mandatory fora in DISH's
contract with CBS (the other being Colorado), and DISH's contract claims against CBS
accordingly must remain in this Court. (Echtman Dec. '1 16.) In addition, New York law is the
express governing law for DISH's contracts with Fox, ABC and NBC. (Echtman Dec. If 14
(Fox), 15 (NBC) and 17 (ABC).) Third, this is the most comprehensive action. DISH named all
four major networks as defendants in this action in the Southern District of New York, in the

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interests of judicial economy and consistency, in order to have the common copyright issue
determined before one court in a manner that binds all interested parties. DISH also pleaded
contract claims against each defendant, and the contract issues are inextricably intertwined with
the copyright issues. Finally, the networks can hardly complain of the inconvenience of being
sued in New York; ABC, CBS and NBC headquarters are located in the Southern District of
New York. DISH Comp.

10-11, 13. And, News Corporation, owner of Fox, is headquartered

in New York. News Corporation, Form 8-K (May 25, 2012), available at
http://investor.newscorp.com/secfiling.cfm?filingID=1181431-12-32829.
DISH tried to avoid the need to file this motion. DISH wrote to counsel for Fox, CBS
and NBC on Friday, May 25, 2012, the day after the suits were filed, and requested that those
defendants agree to dismiss, transfer or stay their later-filed cases in deference to the first-filed
suit in this Court. (Echtman Dec. Ex. 9.) In the absence of such an agreement, DISH asked that
Fox, CBS and NBC commit, at a minimum, to hold their California actions in abeyance pending
a determination of proper venue by this Court. Id. DISH further represented that it was
available to discuss the issue by telephone over the three-day weekend. Id.
Fox responded to DISH's letter the same day, stating that it would be moving to dismiss
this action and dubbing DISH's declaratory judgment action a "sham" but not answering
whether it would hold its California action in abeyance pending this Court's determination of
venue. (Echtman Dec. Ex. 10.) On Saturday, May 26, 2012, counsel for DISH sent Fox's
attorneys an email again requesting a response to its request that Fox's California action be held
in abeyance and the courtesy of a telephone call to meet and confer over the weekend. (Echtman
Dec. Ex. 11.) In Fox's Order to Show Cause papers, Fox had noted that it is "mindful that [its]
Application is being filed before a holiday weekend and that the Court is closed on Monday,

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May 28, 2012" yet requested a briefing schedule that required DISH to file substantive
opposition papers "no later than Wednesday, May 30, 2012." (Echtman Dec. Ex. 7.) At the
same time that Fox filed papers that required DISH's attorneys to work over the holiday
weekend, Fox's attorneys were unwilling to extend the courtesy of participating in a weekend
telephone call with DISH's counsel. On Sunday, May 27, 2012, DISH again requested a specific
response to DISH's request that Fox hold its Order to Show Cause in abeyance. (Echtman Dec.
Ex. 12.) Fox responded the same day, refusing to stay its California action or to speak prior to
Tuesday, May 29, 2012. (Echtman Dec. Ex. 13.) As a compromise, DISH offered to meet and
confer on Tuesday morning. (Echtman Dec. Ex. 14.) Fox responded that it would not hold its
Order to Show Cause in abeyance. (Echtman Dec. Ex. 15.)
By declining to speak to DISH's counsel by telephone at any time during the course of
the three-day weekend or Friday afternoon, Fox effectively frustrated DISH's efforts to comply
with this Court's individual practice rules. Because Fox refused to suspend its Order to Show
Cause in California, DISH is pursuing relief by Order to Show Cause as well, and seeks a
temporary restraining order against Fox, to permit this Court to determine proper venue without
the risk of inconsistent proceedings taking place in California.
In order to have this motion for an anti-suit injunction heard once with respect to all
parties, DISH has joined CBS and NBC in the motion, despite the fact that it has not yet
completed the meet and confer process with those parties. DISH initiated the process by
reaching out to counsel for CBS and NBC on Friday, May 25, 2012. (Echtman Dec. Ex. 9.)
When DISH did not immediately hear back from those attorneys, it followed-up over the
weekend to ensure that they had received DISH's meet and confer letter. (Echtman Dec. 25.)
On Sunday, May 27, 2012, counsel for CBS and NBC acknowledged receipt of DISH's letter

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and represented that they would be providing a detailed response in accordance with this Court's
individual practices and would be available to meet and confer by telephone after the holiday
weekend. (Echtman Dec. Ex. 16.) On May 28, 2012, DISH provided CBS and NBC with an
update regarding its attempts to meet and confer with Fox, notifying CBS and NBC of its
intention to file its motion on the following day. (Echtman Dec. Ex. 17.) Because CBS and
NBC have not sought expedited relief in the Central District of California, DISH does not
request a temporary restraining order against those defendants, and will complete the meet and
confer process with CBS and NBC. In the event that any of the issues raised in this motion can
be resolved on consent with CBS and NBC, DISH will amend its motion accordingly.
DISH provided counsel for Fox, NBC and CBS with copies of DISH's motion papers
before submitting them to Chambers. (Echtman Dec. ar 27.) DISH also obtained contact
information from counsel for Fox, NBC and CBS for attorneys located in their New York offices
who might be available to appear on this motion. (Echtman Dec. Exs. 15, 17.)

FACTUAL BACKGROUND
The Parties
DISH is a satellite television provider that provides pay-television service to millions of
subscribers. DISH Comp. ¶ 2. DISH has contracts with each of the defendants in this action,
Fox, CBS, NBC and ABC

which are collectively the four major television networks. Id.

Those contracts, among other things, permit DISH to re-transmit the broadcast signals of the
networks' owned and operated affiliates to DISH's subscribers in exchange for substantial fees.
Id. DISH pays annual fees to the major television networks and their affiliates in the hundreds of
millions of dollars. Id.

The Hopper

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In mid-March 2012, DISH brought the Hopper to market, a best-in-class HD DVR.
DISH Comp.1 19. Critics praised the Hopper for its ease of use and powerful technical
specifications and features. Id. ¶ 20. PCMagazine named the Hopper an "Editor's Choice"
among DVR products, calling the Hopper "one of the best DVRs we've ever seen." Id. Popular

Mechanics also gave the Hopper an "Editor's Choice" award for outstanding achievement in new
product design and innovation. Id. One feature, PrimeTime Anytime, allows viewers, with the
press of a button, to record three hours of primetime HD programming from each of the four
major television networks every night. Id.

21. Those recorded primetime shows remain

available on the Hopper for eight days. Id. Because PrimeTime Anytime allows viewers to
watch more primetime programming than they did before, viewers using PrimeTime Anytime
are being exposed to programs that they otherwise might have missed. Id. Most primetime
viewing occurs the same day, so PrimeTime Anytime is expected to increase viewer exposure to
primetime shows and ultimately increase live viewership for the major television networks. Id.
The Auto Hop Feature
On May 10, 2012, DISH unveiled AutoHop, an additional feature for the Hopper. DISH
Comp. ¶ 23. AutoHop provides DISH's pay-television subscribers the option of skipping
commercials when playing back a primetime show recorded with PrimeTime Anytime. Id. That
feature is not available until after 1 a.m. Eastern time on the day following the show's initial
broadcast. Id.

30. DISH does not alter the network signal. Id. The original program airs in

the same form transmitted by the network. DISH does not alter the DVR recording either. The
commercials are not deleted or erased from the recorded program. Id. ¶ 23. The commercials
are viewable if the customer does not elect to use AutoHop for any playback. Id. Even with
AutoHop enabled, customers can view commercials by fast forwarding or rewinding during the

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playback of a recorded show. Id. All AutoHop does is to compress the fast-forward function
into a split second whenever the DVR hits a block of commercials.
AutoHop provides viewers with a more efficient means to do what they have been doing
for decades, opting not to watch commercials. DISH Comp. 111-24-25. Viewers have always
skipped commercials, using the commercial break as an opportunity to get up and momentarily
leave the room. Id. ¶ 25. With the advent of the remote control in the 1950s, viewers began to
change the channel or mute the sound during commercial breaks. Id. In 1955, when Zenith
Electronics Corporation introduced the first wireless remote control, known as the "FlashMatic," it advertised to viewers, "Just think! Without budging from your easy chair you can turn
your new Zenith Flash-Matic set on, off or change channels. You can even shut off annoying
commercials while the picture remains on the screen." Margalit Fox, Eugene Polley, Conjuror
of a Device That Changed TV Habits, Dies at 96, N.Y. TIMES, May 23 2012, at A21 (emphasis in
the 1955 original). With the introduction of the VCR in the 1970s, viewers playing back a
recorded show began to fast-forward through commercials. DISH Comp. ¶ 25. Today, many
DVRs include a 30-second skip feature, which allows viewers to skip over a standard 30-second
commercial advertisement. Id. ¶ 24. By pressing the 30-second skip button multiple times in
succession, a viewer can bypass an entire commercial break between show segments. Id. DISH
has had that feature for 10 years. Id. NBC's cable affiliate, Comcast, the biggest pay television
provider in the nation, also provides its customers with DVR set top boxes and a remote control
that can be programmed to provide 30-second skip functionality. Id.
The Major Television Networks Attack AutoHop In The Press
Shortly after DISH introduced AutoHop, top executives at the major television networks
launched a highly public attack on commercial-skipping. DISH Comp. ¶ 32. For example, on

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May 17, 2012, CBS Chairman Les Moonves declared, "[t]hey can't put our content on without
commercials. . . . They just can't do it. It's illegal." Tim Molloy, CBS's Moonves on Dish's

Auto Hop: 'It's Illegal', REUTERS (May 27, 2010), available at http://news.yahoo.com/cbssmoonves-dishs-auto-hop-illegal-193411443.html;(Echtman Dec. Ex. 2).
A May 23, 2012 news article reported that "the parent companies of the four major
broadcasting networks -- Fox Broadcasting, NBCUniversal, ABC/Disney Television Group and
CBS Corp. -- have begun consulting with major law firms with the expectation that litigation will
be filed against Dish" and that "[t]he networks are said to be examining their Dish license
agreements, looking for breaches of contract that can be alleged along with claims for copyright
infringement. One top exec said a lawsuit should be expected within a month." Matthew
Belloni, DISH vs. TV Networks: Attorneys Readying Showdown over Auto Hop, THE
HOLLYWOOD REPORTER (May 23, 2012), http://www.hollywoodreporter.com/thr-esq/dish-autohop-tv-networks-lawsuit-327958;(Echtman Dec. Ex. 3).
In addition, at almost the same time, Fox, CBS and NBC all began rejecting Hopper
advertising from DISH, claiming that the advertisements were contrary to their interests. DISH
Comp. ¶ 35. By attacking the legality of AutoHop and refusing all Hopper advertising, the
networks cast a cloud over DISH's product, and threatened DISH's ability to promote and sell
the Hopper DVR.
DISH Brings a Declaratory Judgment Action in Defense of the Hopper and AutoHop
On Thursday, May 24, 2012, at 4:06 p.m. Eastern Daylight Time, DISH filed this action
against Fox, CBS, NBC and ABC seeking a declaratory judgment that it was not infringing on
defendants' copyrights and that it was not otherwise in breach of the relevant underlying re-

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transmission agreements. See generally DISH Comp. Service on all defendants was completed
the next day.
DISH brought a single action against all of the networks alleging copyright and contract
claims in order to avoid duplicative, piecemeal litigation, and to settle the growing dispute over
the legitimacy of the Hopper and AutoHop, with all relevant parties and claims joined in one
forum. This is the precise purpose of a declaratory judgment action, to avoid a multiplicity of
suits and the risk of inconsistent adjudications. Assicurazioni Generali, SpA v. Terranova, 40
Fed. R. Serv. 2d 850, 1984 WL 1191, at *5 (S.D.N.Y. Oct. 25, 1984) (citations omitted) ("[T]he
very purpose of a declaratory judgment is to avoid multiplicity of lawsuits and piecemeal
litigation by providing a method for settlement of a controversy in its entirety."); see also

Derman v. Gersten, 22 F.Supp. 877, 879 (E.D.N.Y. 1938); 10B CHARLES ALAN WRIGHT,
ARTHUR R. MILLER, MARY KAY KANE & RICHARD L. MARCUS, FEDERAL PRACTICE &
PROCEDURE § 2761 (3d Ed. updated 2012).
DISH selected the Southern District of New York as the venue for this action, because it
is the only forum where all parties and issues could be joined. DISH's agreements with CBS and
ABC contain mandatory forum selection clauses providing for jurisdiction over any dispute in
the Southern District of New York. The CBS agreement states: "[t]he federal and state courts
located in the city and state of Denver, Colorado and the Southern District of New York shall
have exclusive jurisdiction to hear and determine any claims, disputes, actions or suits that
may arise under or out of this Agreement and each party hereby waives its right to make
any claim to the contrary." (Echtman Dec. 16 (emphases added).) The ABC agreement

confines jurisdiction to this district, stating "[t]he Federal and state courts located in the County
of New York in State of New York shall have exclusive jurisdiction to hear and determine any

claims, disputes, actions or suits which may arise under or out of this Agreement and each
party hereby waives its right to make any claim to the contrary." (Echtman Dec. 1 17
(emphases added).)
Furthermore, New York law governs disputes pertaining to DISH's agreements with
three of the four networks. The NBC and Fox agreements state that those contracts will be
"governed by and construed in accordance with the laws of the State of New York."
(Echtman Dec.'( 15 (NBC) and 14 (Fox).) The contract between DISH and ABC similarly
contains a choice of law provision stating that the agreement and "all collateral matters
relating thereto shall be construed in accordance with the laws of the State of New York."
(Echtman Dec. 17).
DISH certainly had no reason to believe that any defendant would object to having the
claims heard in New York. All of the parties to this suit have substantial contacts with New
York. ABC, CBS and NBC have headquarters in Manhattan. DISH Comp. 10-11, 13. And,
Fox also maintains offices and television studios here. Id. 12. Fox's parent, News Corporation,
is headquartered in New York. News Corporation, Form 8-K (May 25, 2012), available at
http://investor.newscorp.com/secfiling.cfm?filingID-1181431-12-32829. In addition, DISH is
involved in an ongoing litigation with Walt Disney (ABC's parent company) in this Court. See

Disney Enterprises, Inc., et al. v. DISH Network, L.L.C., No. 11 Civ. 2973 (S.D.N.Y. 2011).
Fox, NBC and CBS Launch Three Different Coordinated Actions in Los Angeles
What DISH did not know was that the press reports about possible litigation were wrong.
The networks were not just assessing their options and taking their time in deciding whether to
sue. Rather, three of the four major television networks planned to file suit imminently, but
separately, on the opposite coast. Later on May 24, 2012, after DISH filed this action, Fox, CBS

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and NBC each filed complaints in the district court for the Central District of California, raising
the same issues raised by DISH in the Complaint filed this action, all relating to DISH's Hopper
DVR and AutoHop. Fox brought claims for copyright infringement and breach of contract.
CBS and NBC brought copyright infringement claims alone, as if the re-transmission contracts
were completely irrelevant.
Defendants do not dispute that DISH was the first to file. DISH filed its complaint at
4:06 p.m. Eastern Daylight Time. Fox filed its complaint at 1:35 p.m. Pacific Daylight Time, or
4:35 p.m. Eastern Daylight Time. (See Echtman Dec. Ex. 4.) NBC filed its complaint at 2:32
p.m. Pacific Daylight Time, or 5:32 p.m. Eastern Daylight Time. (See Echtman Dec. Ex. 5.)
CBS filed its complaint at 3:29 p.m. Pacific Daylight Time, or 6:29 p.m. Eastern Daylight Time.

(See Echtman Dec. Ex. 6.)
CBS Corporation, oddly, did not name itself as a plaintiff in its litigation against DISH,
and instead named affiliates as its proxies, presumably to attempt to evade the forum selection
provisions that it had agreed upon with DISH.'
Fox, in contrast, brought a contract claim as part and parcel of its copyright infringement
action, demonstrating that the contract and copyright issues are intertwined.2At the same time
Fox commenced its action, it submitted an Order to Show Cause to the district court in

1

CBS Corporation sued as "CBS Broadcasting Inc., CBS Studios Inc., and Survivor Productions LLC" (see
Echtman Dec. Ex. 6); NBCUniversal Media LLC has sued as "NBC Studios, LLC, Universal Network Television,
LLC, Open 4 Business Productions, LLC, and NBCUniversal Media, LLC" (see Echtman Dec. Ex. 5); and Fox
Entertainment Group, Fox Television Holdings, and Fox Cable Network Services have sued as "Fox Broadcasting
Company, Inc., Twentieth Century Fox Film Corp., and Fox Television Holdings (see Echtman Dec. Ex. 4)."
2

Inexplicably, Fox's complaint takes issue with DISH's Sling Adapter product that DISH has sold since
November 2010. The Sling Adapter functions like other Sling products and services, which DISH has been selling
since late 2007. Fox appears to have anticipated a declaratory judgment action by DISH, and added stale claims to
attempt to distinguish its action and make it appear different. But while Fox seeks immediate relief from the
California court, it can make no claim whatsoever that resolution of its new-found complaint over an old product
requires the extraordinary action of a TRO or a preliminary injunction.

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California, requesting an accelerated briefing schedule on a motion for immediate discovery in
support of a prospective preliminary injunction motion. (Echtman Dec. Ex. 7.) Fox's claims of
urgency are disingenuous, considering that the Hopper DVR with PrimeTime Anytime has been
on the market since mid-March and the Sling Adapter has been sold by DISH for a matter of
years. There was no need for Fox to rush into court with an Order to Show Cause. The network
rating sweeps period is at an end, most of Fox's primetime programming has concluded its
regular season, and Fox and the other major television networks are now showing reruns.

ARGUMENT
This Court should follow the presumptive first-filed rule and enjoin Fox, CBS and NBC
from prosecuting their later-filed California actions. None of the limited exceptions to the firstfiled rule applies, and the balance of considerations decisively favor proceeding with all issues in
DISH's first-filed action in this Court. In addition, DISH respectfully requests that this Court
temporarily restrain Fox from proceeding with its later-filed action until such time as this Court
has had an opportunity to consider and determine the venue where these overlapping claims
should be heard.
FOX, CBS AND NBC SHOULD BE ENJOINED FROM PURSUING
DUPLICATIVE ACTIONS IN CALIFORNIA, AND FOX SHOULD BE
TEMPORARILY RESTRAINED FROM PURSUING ITS ACTION
PENDING A RULING BY THIS COURT
As a rule in the Second Circuit, "[w]here there are . . . competing lawsuits, the first suit
should have priority." Employers Ins. of Wausau v. Fox Entm't Group, Inc., 522 F.3d 271, 27475 (2d Cir. 2008) (citing First City Nat'l Bank & Trust Co. v. Simmons, 878 F.2d 76, 79 (2d Cir.
1989)); New York v. Exxon Corp., 932 F.2d 1020, 1025 (2d Cir. 1991). The same rule applies in
the Ninth Circuit, where Fox, CBS and NBC brought their later-filed actions. Alltrade, Inc. v.

Uniweld Prods., Inc., 946 F.2d 622, 628 (9th Cir. 1991); see also Pacesetter Sys., Inc. v.
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Medtronic, Inc., 678 F.2d 93, 94-95 (9th Cir. 1982); Summit Entm't, LLC v. Bath & Body Works
Brand Mgmt., Inc., No. 11 Civ. 3570, 2011 WL 2649973 (C.D. Cal. July 5, 2011) (Le J.).
"This rule 'embodies considerations of judicial administration and conservation of resources' by
avoiding duplicative litigation and honoring the plaintiff's choice of forum." Employers Ins. of

Wausau, 522 F.3d at 275 (quoting First City Nat'l Bank & Trust Co., 878 F.2d at 80).
As this Court has recognized in the case of Reliance Ins. Co. v. Six Star, Inc., at a
minimum, the court in which the first-filed case was brought "decides whether the first-filed rule
or an exception to the first filed rule applies." Reliance Ins. Co. v. Six Star, Inc., 155 F. Supp. 2d
49, 54 n. 2 (S.D.N.Y. 2001) (Swain, J.) ("Reliance") (one day between filings) (citing Citigroup,

Inc. v. City Holding Co., 97 F. Supp 2d 549, 556 n. 4 (S.D.N.Y. 2000)); see also Stroock &
Stroock & Lavan v. Valley Sys., Inc., No. 95 Civ. 6513, 1996 WL 11249, at *4 (S.D.N.Y. 1996).
This holds true regardless of the time interval between filings. Daimler-Chrysler Corp. v.

General Motors Corp., 133 F. Supp. 2d 1041, 1043-44 (N.D. Oh. 2001) ("Leaving the decision
of the first to file dispute to the court in which the first case was filed makes good sense.")
(twelve minutes between filings); Horn & Hardart Co.v. Burger King Corp., 476 F.Supp. 1058,
1060 (S.D.N.Y. 1979) ("[W]e do not see how the brevity of interlude can effect the danger of
inconsistent results and duplication of judicial effort. One court or the other must decide which
case is to proceed, and controlling authorities place the burden upon us.") (two and one-half
hours between filings); see also Intuitive Surgical, Inc. v. Cal. Institute of Tech., No. 07 Civ.
0063, 2007 WL 1150787, at *2-3 (N.D. Cal. Apr. 18, 2007) ("the court in the first-filed action
should decide whether there is an exception to the first-to-file rule" because `Mlle policy
rationale behind the first-to-file rule is supported by reasons 'just as valid when applied to the

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situation where one suit precedes the other by a day as they are in a case where a year intervenes
between the suits' (citation omitted)) (hours between filings).
There is a strong presumption in favor of having all actions heard in the first-filed forum,
and the party opposing application of the first-filed doctrine bears the burden to show that special
circumstances demand an exception to its application. Reliance, 155 F. Supp. 2d at 54. Identical
parties and issues are not required; the test is whether the later filed actions embrace the issues in
the first-filed action. Toy Biz, Inc. v. Centuri Corp., 990 F.Supp. 328, 332 (S.D.N.Y. 1998)
(citing Meeropol v. Nizer, 505 F.2d 232, 235-37 (2d Cir. 1974)).
Where a case is filed in one federal district court, and later litigation embracing the same
issues is commenced in another federal court, the first court has authority to enjoin the
prosecution of the later-filed litigation by issuance of an anti-suit injunction. New York v. Exxon

Corp., 932 F.2d at 1025; Meeropol, 505 F.2d at 235-36. The court's power to enjoin prosecution
derives from Fed. R. Civ. P. 65, governing injunctions and restraining orders. Forinflex Founds.,

Inc. v. Cupid Founds., Inc., 383 F.Supp. 497, 498 (S.D.N.Y. 1974) (analyzing injunction in
connection with first-filed rule pursuant to motion under Fed. R. Civ. P. 65). The first-filed court
is also authorized to issue a temporary restraining order barring the litigants from proceeding
with later-filed cases until the forum issue is properly resolved. See BuddyUSA, Inc. v.

Recording Industry Ass 'n of Am., 21 Fed. Appx. 52, 54 (2d Cir. 2001); see also Horn & Hardart
Co, 476 F. Supp. at 1060.
While the first-filed court determines where the dispute should proceed, there are two
exceptions to the first-filed rule of priority between actions

neither of which applies here

that may justify a decision by the first-filed court that the dispute should proceed in a later-filed
venue. Those exceptions to first-filed priority are: (1) where special circumstances warrant

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giving priority to the second suit, or (2) where the balance of convenience favors the later-filed
action. Employers Ins. of Wausau, 522 F.3d at 275. Because the balance of convenience favors
the Southern District of New York and there are no special circumstances that warrant giving
priority to the later-filed suits, an anti-suit injunction should issue and bar Fox, CBS and NBC
from proceeding in California, and this action, which names all of the relevant parties and
encompasses all of the core issues, should be permitted to go forward.

II. THE BALANCE OF CONVENIENCE FACTORS
FAVOR DISH'S FIRST-FILED ACTION
The balance of convenience weighs decisively in favor of DISH's first-filed action in this
district. In order to weigh the balance of convenience, courts look to the factors considered in
connection with motions to transfer venue pursuant to 28 U.S.C. §1404(a). Everest Capital Ltd.

v. Everest Funds Mgmt., L.L.C., 178 F. Supp. 2d 459, 465 (S.D.N.Y. 2002) (Swain, J.)
("Everest") (five days between filings); Reliance, 155 F. Supp. 2d at 56-57. Those factors are:
(1) convenience of witnesses; (2) location of documents and access to sources of proof; (3)
convenience of the parties; (4) locus of the operative facts; (5) availability of process to compel
attendance of unwilling witnesses; (6) relative means of the parties; (7) forum's familiarly with
the governing law; (8) weight accorded plaintiff's choice of forum; and (9) trial efficiency and
the interests of justice. Everest, 178 F. Supp. 2d at 465. The most critical of these factors
which are trial efficiency and the interest of justice, convenience of the parties and familiarity
with governing law — make clear that the claims between these parties should be determined in
this action.
(1)

Trial Efficiency and the Interests of Justice

The factor of trial efficiency and interests of justice is often determinative. Everest, 178
F. Supp. 2d at 468-69. Here, the interests of justice and trial efficiency favor a consolidated
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litigation where all necessary parties are present and all issues are raised, to permit a
comprehensive resolution that avoids inconsistent adjudications. This case is not only about
copyright, it is also about the scope of the re-transmission contracts between DISH and the four
major networks. DISH's copyright and contract claims will proceed against ABC in this Court
no matter how this Court decides this motion with respect to Fox, CBS and NBC. It would be
contrary to trial efficiency and the interests of justice to split these issues among separate suits.
Based on the forum selection clauses in the ABC and CBS contracts, the Southern District of
New York is the only venue where all of the claims can be heard together. See Reliance, 155 F.
Supp. 2d at 57 ("[T]he Supreme Court has made clear the [t]he presence of a forum selection
clause . . . will be a significant factor that figures centrally in the district court's calculus.'"
(citing Stewart Organization, Inc. v. Ricoh Corp., 487 U.S. 22, 29 (1988))).
Moreover, the forum selection clause in the CBS contract is broad enough to encompass
the copyright claims that CBS affiliates brought in California. It is well established in this
Circuit that it is the substance, not the form of a claim that determines whether the forum
selection clause applies. Roby v. Corp. of Lloyd's, 996 F.2d 1353, 1361 (2d Cir. 1993). This
dispute over whether DISH has the right to provide its customers with a DVR that allows them to
time-shift their viewing of CBS broadcast content implicates the contract between DISH and
CBS, which authorizes DISH to transmit that content from CBS owned and operated affiliates to
its satellite pay-television subscribers in exchange for substantial re-transmission fees. It is also
well established that non-parties to an agreement are subject to the forum selection clause, if they
are "closely related to the dispute such that it becomes foreseeable that [they] will be bound."
Nanopierce Tech., Inc. v. Southridge Capital Mgmt., No. 02 Civ. 0767, 2003 WL 22882137, at
*5 (S.D.N.Y. Dec. 4, 2003) (citation omitted). A non-party is closely related to a dispute if its

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"interests are completely derivative of and directly related to, if not predicated upon, the
signatory party's interests or conduct." Cfirstclass Corp. v. Silverjet PLC, 560 F. Supp. 2d 324,
328 (S.D.N.Y. 2008) (citation omitted).
In addition, causes of action that will "necessarily require analysis of the parties' rights
and duties under the agreements" are within the scope of those agreements' forum selection
clauses. Cfirstclass Corp., 560 F. Supp. 2d at 330 (applying a forum selection clause to causes
of action that were based "on assertions regarding [the plaintiff's] rights . . . pursuant to the two
agreements"); see Direct Mail Prod. Services Ltd. v. MBNA Corp., No. 99 Civ. 10550, 2000 WL
1277597, at *6 (S.D.N.Y. Sept. 7, 2000). In Direct Mail, the court held that a narrow forum
selection clause encompassed the plaintiffs copyright infringement claims because the court's
analysis of those claims would "inevitably require reference to rights and duties defined in the
Agreement, since the Agreement was essentially a license that governed [the defendant's] use of
[the plaintiffs] databases." Direct Mail, 2000 WL 1277597 at *6; see also Bluefire Wireless,

Inc. v. Cloud9 Mobile Commc 'ns, Ltd., No. 09 Civ. 7268, 2009 WL 4907060, at *3 (S.D.N.Y.
Dec. 21, 2009) (non-contract claims were subject to forum selection clause where "the entire
relationship between" the parties arose out of the contract).
Here, too, an analysis of CBS's claims that DISH's and its customers' use of the
AutoHop feature infringes on a copyright will implicate rights under the re-transmission
agreement between CBS and DISH. Those contract issues must be determined in DISH's New
York action.
(2)

Convenience of the Parties

The convenience of the parties also favors maintaining this action in New York, where it
was first-filed. Outside of the litigation context, Fox, CBS and NBC negotiated for New York as

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a proper forum and/or for the application of New York law. Moreover, CBS, NBC and ABC
have their headquarters in New York, as well as Fox's parent, News Corporation. The
convenience of the parties weighs heavily in favor of maintaining the New York action ahead of
the later-filed actions in California.
(3)

Familiarity With The Applicable Law

The fact that the Fox, NBC and ABC's agreements with DISH are expressly governed by
New York law is yet another factor that militates in favor of the Southern District of New York
as the appropriate forum. In sum, the balance of convenience overwhelmingly favors DISH. All
of the relevant factors favor maintaining this action in this Court.
III. NO "SPECIAL CIRCUMSTANCES" WARRANT
PROCEEDING IN A LATER-FILED FORUM
Fox has made an unwarranted accusation that DISH's action is a "sham." It is not. DISH
commenced an appropriate declaratory judgment action that serves the express purpose of such
actions — to resolve uncertainty about the parties' legal rights and responsibility and to avoid a
multiplicity of suits. Plaintiffs seek declaratory judgments because they are "challenged,
threatened, or endangered [from the] enjoyment of what [they claim] to be [their] rights, to
initiate the proceedings against [their] tormentor and remove the cloud by an authoritative
determination of [their] legal right[s], privilege[s] and immunity[ies] and the [defendants']
absence of right[s], and disability[ies]." Everest, 178 F. Supp. 2d at 469 (relying on United

States v. Doherty, 786 F.2d 491, 498-99 (2d Cir. 1986)).
In certain contexts — not present here — courts decline to apply the first-filed rule where
the first suit constitutes an improper anticipatory filing or a filing made under questionable
circumstances. Kellen Co. v. Calphalon Corp., 54 F. Supp. 2d 218, 223 (S.D.N.Y. 1999); Toy

Biz, Inc., 990 F.Supp. at 332. The courts will examine whether the first-filing party has acted in
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bad faith, by lulling another party into a sense of security that negotiations are on-going, and then
rushing to commence an action first in an inconvenient forum. That is not the case here.
In BuddyUSA, Inc. v. Recording Industry Association of America, the Second Circuit
examined a case where the district court issued a temporary restraining order prohibiting
defendants from proceeding with a later filed action in the Southern District of New York, and
later converted that order into a preliminary injunction, ruling that plaintiffs did not bring an
"anticipatory" declaratory judgment action. 21 Fed. Appx. 52 (2d Cir. 2001). The panel in

BuddyUSA reviewed a closer call than is presented to the Court in this motion. In BuddyUSA, a
demand letter had been sent by the later-filing party, warning plaintiffs that they had one week to
comply or the defendants would have "little choice" but to "seek additional remedies." Id. at 54.
The Second Circuit noted that district courts typically find exceptions to the first-filed rule
"where declaratory actions are filed in response to demand letters that give specific warnings as

to deadlines and subsequent legal action." Id. at 55 (emphasis added). "By contrast, district
courts have often refused to characterize a suit as anticipatory where it is filed in response to a
notice letter that does not explicitly 'inform a defendant of the intention to file suit, a filing date,
and/or a specific forum for the filing of the suit." Id (citation omitted). Here, the question is
easier. There was no notice letter, cease and desist letter, or indication of a direct threat of
litigation of any kind. (Declaration of David Shull dated May 28, 2012 ("Shull Dec.") ¶3.)
Accordingly, DISH's first-filed action was clearly not "anticipatory" under controlling Second
Circuit precedent.
DISH received no direct communications from the networks that they were going to
commence an action and there were no efforts by the networks to resolve the issues between the
parties without the necessity of a lawsuit. (See generally Shull Dec. !- 3.) The networks made

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generalized and ambiguous disparaging remarks about Auto Hop and challenged its legitimacy in
the media, with one network chairman going so far as calling the service "illegal." Fox, CBS
and NBC all stopped carrying advertising for the Hopper. Media reports indicated that the
networks were contemplating suit, but DISH never received anything that could fairly be
characterized as a direct threat of litigation, such as a notice letter indicating that suit would be
filed in a particular venue on a particular date, or even an inquiry offering to discuss or mediate
the dispute. DISH filed in the natural and correct forum, and brought all of the interested parties
together to achieve the purpose of a declaratory judgment action, to fully resolve the issues and
eliminate any cloud of uncertainty hanging over its rights.
A declaratory judgment action does not, in and of itself, trigger the anticipatory filing
exception. Under the rules governing declaratory judgment actions, it is appropriate for a party
to commence an action when the nature and tone of communications with another party has
provided it with a reasonable apprehension that, if the activity in issue continues, it will be sued.

Everest, 178 F. Supp. 2d at 470. That is exactly what declaratory relief is for, and precisely what
happened here. The networks were making vague indirect public threats, but had not filed any
action against DISH.
This Court expressly recognized in the Everest case that a proper declaratory judgment
action will be accorded the same deference as any other first-filed lawsuit. Everest, 178 F. Supp.
2d at 470; see also Employers Ins. of Wausau, 522 F.3d at 277 ("the action was not improperly
anticipatory — it was not a response to a direct threat of litigation . . . Although litigation was
clearly on the horizon, evidenced by the parties' retention of . . . counsel and the general tenor of
the communications leading up to the action, and Appellees may have been caught off guard by
the timing of the complaint, there was no notice letter or other communication conveying a

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specific threat of litigation"). This proper declaratory judgment action should similarly be
accorded the appropriate deference as a first-filed action, and should proceed in this Court.
The only other "special consideration" that might bar application of the first-filed rule
relates to forum shopping. Forum shopping "justifies an exception to the first-filed rule 'where a
suit bears only a slight connection to the [forum].' Reliance, 155 F. Supp. 2d at 55 (citing Toy

Biz, Inc., 990 F.Supp. at 332). As set forth above, there was no forum-shopping by DISH. DISH
chose the only appropriate forum for this action. If any parties were engaging in forum
shopping, it appears to be Fox, CBS and NBC. Because no special considerations apply, the
Court should apply the first-filed doctrine and enter an anti-suit injunction in DISH'S favor, as
well as a temporary restraining order against Fox.

CONCLUSION
This dispute belongs in New York, where DISH filed first. For the foregoing reasons,
DISH respectfully requests that this Court grant its motion for an anti-suit injunction, barring
Fox, CBS and NBC from prosecuting their later filed actions in the Central District of California,
and temporarily restraining Fox from proceeding with its later-filed action pending a decision on
this motion, together with such other and further relief as may be just and proper.
Dated: New York, New York
May 29, 2012
Respectfully submitted,
ORRICK HERRINGTON & SUTCLIFFE LLP

Peter A. Bicks
[e-mail]
E. Joshua Rosenkranz
[e-mail]
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Elyse D. Echtman
[e-mail]
51 West 52nd Street
New York, New York 10019-6142
[phone]
Annette L. Hurst (subject to admission pro hac vice)
[e-mail]
The Orrick Building
405 Howard Street
San Francisco, California 94105-2669
[phone]
Of Counsel:
Mark A. Lemley (subject to admission pro hac vice)
mlemley@durietangri
Michael Page (subject to admission pro hac vice)
MPage@durietangri
Durie Tangri LLP
217 Leidesdorff Street
San Francisco, California 94111
[phone]

Attorneys for DISH Network L.L. C.

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